FINANCIAL SERVICES
UMass Dartmouth Budget Update
UMass Dartmouth Budget Update
When we think of March it is natural to begin thinking about spring; especially after a long cold winter, such as we have experienced this year. Traditionally, Spring is associated with the idea of rebirth and new growth and regeneration. When I think of the University I think of it in the context of spring. These are transformative times that we are encountering. Like a butterfly emerging from a cocoon, the university is at a pivotal point in our history where we have the opportunity to embrace the change that has come from the transition in leadership across our campus. We have the opportunity to come together to create a community that builds upon the strengths, time-honored traditions that we value to enhance the way that we do business. These are exciting and challenging times that we are faced with.
All of us are aware of the budget challenges that the University has experienced over the last year and continue to face as we work towards identifying ways to manage the budget shortfall. In FY13, Chancellor Grossman, Chief Operating Officer McLaughlin along with the Budget Office have focused on efforts to improve transparency. We reached out to our community to educate you on the complex issues that the University faces. There were many valuable conversations that resulted in the actions taken to reduce the FY13 shortfall. This is hard work that many of you have participated in and have helped to identify solutions; and we thank you for this. We have some great momentum going on in this area. Challenges will always be a part of our business; whether it is in the form of declining state funds, prevailing economic conditions, increased competition for enrollment or other issues. In considering all of these conditions, we need to be mindful that we continue along this trajectory and not recoil back to our original place of comfort. For change is not always comfortable, but if we know the challenges we face and we come together as a community, we are able to move as a unit to achieve the overall mission.
As we begin to prepare for the FY14 budget season, I would like to share with you some of the assumptions with which we are working. The governor’s budget was published in January. The initial budget had some good news for the University of Massachusetts system. The governor’s budget does include funding associated with the FY14 collective bargaining costs. This is good news because typically the second year of our labor contracts are not always guaranteed to be financially supported by the state. In addition, the governor’s budget provides for an additional increase in the state appropriation to support the 50 /50 initiative supported by President Caret. 50 /50 funding refers to the effort to keep access to higher education as an affordable option for students and parents. Basically, the cost to educate an average UMASS student is approximately $23K/yr. For the state to fund half of this cost would require an additional $99 million dollar increase in our state appropriation. Given the type of year the state is experiencing in FY13, we can anticipate that full funding of this initiative will not happen. Consequently, the governor’s budget provides for an additional $25M toward reaching the 50/50 funding ratio. Also included in the governor’s budget is the provision for the ATMC and Star Store funding. Again this is good news, as these items are not always guaranteed funding. Please bear in mind, this is the first step in a very long budgeting process that will eventually conclude with a final state budget in mid-to-late June. It is still early on in the State Budgeting processes and many changes are anticipated as the budget works its way through the various house committees.
We will keep an eye on the changes and be adjusting our budgeting assumptions as information on the state budget becomes available. For now, we will be calculating our budgets using the assumption that FY14 collective bargaining is included in our state allocation, and the Star Store and ATMC are funded. At this point in time, we will be developing revenue projections based upon a 4.9% increase in Mandatory fees. We will continue to monitor the State Budget process throughout the upcoming months to determine if the 50/50 funding provision will survive; as mentioned above, we will reduce fees accordingly should any portion of the 50/50 funding survive the state budget process.
In March, the Budget Office sent out to departments the rate request template. These templates are used to establish the FY14 non-mandatory rates. Non-mandatory rates include college fees and other student fees, administrative fees, Continuing Education Fees, etc. The Budget Office has received these templates and is in the process of calculating revenues generated from non-mandatory fees. Additionally, Departments are busy analyzing their budgets to match need requirements with resources. Very soon, we will begin the exercise of developing the FY14 Operating Budget using these, as well as, a variety of other assumptions. The Budget Office looks forward to sharing with you the results of this coordinated effort and hard work once all the data is collected, analyzed and compiled. Stay tuned for more updates on this subject. Happy Spring!
